Summary Box: January spending lags despite tax cut

SPENDING LAGS: Consumers increased their spending in January by 0.2 percent in January, the weakest showing in seven months.

TAX RELIEF: The tiny increase occurred even though workers began seeing tax cuts show up in their paychecks as a result of a reduction in Social Security taxes that should provide $110 billion in tax relief this year.

OUTLOOK: There is a concern that the impact of the tax cuts designed to give the economy a boost will be blunted by rising costs for energy and food. However, analysts said January sales were hurt by severe winter weather in many parts of the country and the real test of the tax breaks will come this spring when the Easter holiday sales begin.